Recent 'panic' selling reminiscent of GFC

A stretch of uncertainty in global investment markets could see volatility become the 'new normal', an Australian academic claims.

Deakin University finance associate professor Victor Fang said the recent volatility in Greek and Chinese markets has prompted property and share owners to pull out of equity markets.

“The perfect storm of Greece defaulting on its international obligations and a rapid meltdown of China’s sharemarket has knocked the confidence of Australian investors in a way not seen since the global financial crisis," he said.

“The uncertainty in Greece and China means investors are pulling out of equity markets and flocking to the relative safe haven of government bonds. As long as uncertainty and fear rule, the rollercoaster ride will continue for Australian investors."

Mr Fang said while both countries will impact Australian markets, ongoing volatility in China will have a longer-lasting effect than turmoil in Greece.